BST:AV6

Stock Analysis Report

Executive Summary

Avista Corporation operates as an electric and natural gas utility company.

Rewards

PE ratio (13.3x) is below the German market (16.2x)

Earnings grew by 44.4% over the past year

Pays a high and reliable dividend of 4.1%

Risk Analysis

Earnings are forecast to decline by an average of -1.9% per year for the next 3 years

Interest payments are not well covered by earnings

Highly volatile share price over past 3 months

Large one-off items impacting financial results



Snowflake Analysis

Established dividend payer with proven track record.


Similar Companies

Share Price & News

How has Avista's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: AV6's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

1.6%

AV6

-1.0%

DE Integrated Utilities

-0.6%

DE Market


1 Year Return

n/a

AV6

-1.8%

DE Integrated Utilities

-20.9%

DE Market

Return vs Industry: Insufficient data to determine how AV6 performed against the German Integrated Utilities industry.

Return vs Market: Insufficient data to determine how AV6 performed against the German Market.


Shareholder returns

AV6IndustryMarket
7 Day1.6%-1.0%-0.6%
30 Day-17.3%-16.4%-20.0%
90 Day-11.4%-6.2%-26.3%
1 Yearn/a1.9%-1.8%-18.6%-20.9%
3 Yearn/a40.1%25.5%-19.0%-25.8%
5 Yearn/a-6.4%-21.8%-21.1%-31.8%

Price Volatility Vs. Market

How volatile is Avista's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Avista undervalued compared to its fair value and its price relative to the market?

13.65x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: AV6 (€36) is trading above our estimate of fair value (€35.72)

Significantly Below Fair Value: AV6 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: AV6 is good value based on its PE Ratio (13.3x) compared to the Integrated Utilities industry average (17.2x).

PE vs Market: AV6 is good value based on its PE Ratio (13.3x) compared to the German market (16.2x).


Price to Earnings Growth Ratio

PEG Ratio: AV6's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: AV6 is good value based on its PB Ratio (1.4x) compared to the DE Integrated Utilities industry average (2.3x).


Next Steps

Future Growth

How is Avista forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

-1.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AV6's earnings are forecast to decline over the next 3 years (-1.9% per year).

Earnings vs Market: AV6's earnings are forecast to decline over the next 3 years (-1.9% per year).

High Growth Earnings: AV6's earnings are forecast to decline over the next 3 years.

Revenue vs Market: AV6's revenue (2.2% per year) is forecast to grow slower than the German market (4% per year).

High Growth Revenue: AV6's revenue (2.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AV6's Return on Equity is forecast to be low in 3 years time (8.6%).


Next Steps

Past Performance

How has Avista performed over the past 5 years?

9.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AV6 has a large one-off gain of $105.1M impacting its December 31 2019 financial results.

Growing Profit Margin: AV6's current net profit margins (14.6%) are higher than last year (9.8%).


Past Earnings Growth Analysis

Earnings Trend: AV6's earnings have grown by 9.6% per year over the past 5 years.

Accelerating Growth: AV6's earnings growth over the past year (44.4%) exceeds its 5-year average (9.6% per year).

Earnings vs Industry: AV6 earnings growth over the past year (44.4%) exceeded the Integrated Utilities industry 9.4%.


Return on Equity

High ROE: AV6's Return on Equity (10.1%) is considered low.


Next Steps

Financial Health

How is Avista's financial position?


Financial Position Analysis

Short Term Liabilities: AV6's short term assets ($305.1M) do not cover its short term liabilities ($530.7M).

Long Term Liabilities: AV6's short term assets ($305.1M) do not cover its long term liabilities ($3.6B).


Debt to Equity History and Analysis

Debt Level: AV6's debt to equity ratio (112.2%) is considered high.

Reducing Debt: AV6's debt to equity ratio has reduced from 114.1% to 112.2% over the past 5 years.

Debt Coverage: AV6's debt is not well covered by operating cash flow (18.3%).

Interest Coverage: AV6's interest payments on its debt are not well covered by EBIT (2.3x coverage).


Balance Sheet

Inventory Level: AV6 has a high level of physical assets or inventory.

Debt Coverage by Assets: AV6's debt is not covered by short term assets (assets are 0.1x debt).


Next Steps

Dividend

What is Avista's current dividend yield, its reliability and sustainability?

3.99%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: AV6's dividend (4.1%) is higher than the bottom 25% of dividend payers in the German market (1.65%).

High Dividend: AV6's dividend (4.1%) is low compared to the top 25% of dividend payers in the German market (4.86%).


Stability and Growth of Payments

Stable Dividend: AV6's dividends per share have been stable in the past 10 years.

Growing Dividend: AV6's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (52.1%), AV6's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AV6's dividends in 3 years are forecast to be covered by earnings (74.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

9.5yrs

Average management tenure


CEO

Dennis Vermillion (57yo)

0.50

Tenure

US$1,466,641

Compensation

Mr. Dennis P. Vermillion has been the President and Director of Avista Corporation since January 1, 2018 and as its Chief Executive Officer since October 1, 2019. Mr. Vermillion is Director of Alaska Elect ...


CEO Compensation Analysis

Compensation vs Market: Dennis's total compensation ($USD1.47M) is below average for companies of similar size in the German market ($USD3.59M).

Compensation vs Earnings: Dennis's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Dennis Vermillion
CEO, President & Director0.50yrUS$1.47m0.089% $2.3m
Mark Thies
Executive VP11.58yrsUS$1.44m0.17% $4.4m
Marian Durkin
Senior VP14.67yrsUS$1.21m0.10% $2.6m
Ryan Krasselt
VP, Controller & Principal Accounting Officer4.5yrsno data0.021% $534.1k
James Kensok
VP, Chief Information Officer & Chief Security Officer19.17yrsno data0.015% $391.2k
John Wilcox
Investor Relations Managerno datano datano data
Gregory Hesler
VP, General Counsel & Chief Compliance Officer0.25yrno data0.0026% $66.3k
Bryan Cox
Vice President of Safety & Human Resourcesno datano data0.012% $293.0k
David Meyer
VP and Chief Counsel for Regulatory & Government Affairs21.58yrsUS$519.93k0.010% $256.0k
Jason Thackston
Senior Vice President of Energy Resources & Environmental Compliance Officer7.33yrsno data0.034% $865.3k

9.5yrs

Average Tenure

55yo

Average Age

Experienced Management: AV6's management team is seasoned and experienced (9.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Dennis Vermillion
CEO, President & Director0.50yrUS$1.47m0.089% $2.3m
Heidi Stanley
Independent Director13.92yrsUS$180.00k0.031% $788.1k
Scott Morris
Non Executive Chairman12.25yrsUS$3.82m0.24% $6.1m
R. Taylor
Independent Director34.92yrsUS$194.69k0.0086% $218.3k
Kristianne Blake
Lead Director2.92yrsUS$213.75k0.022% $557.9k
Marc Racicot
Independent Director10.67yrsUS$172.50k0.030% $752.9k
Donald Burke
Independent Director8.67yrsUS$195.00k0.027% $671.6k
Rebecca Klein
Independent Director9.92yrsUS$185.50k0.014% $351.0k
Janet Widmann
Independent Director5.67yrsUS$171.00k0.014% $360.6k
Scott Maw
Independent Director3.67yrsUS$175.50k0.016% $398.1k

9.3yrs

Average Tenure

60yo

Average Age

Experienced Board: AV6's board of directors are considered experienced (9.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: AV6 insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Avista Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Avista Corporation
  • Ticker: AV6
  • Exchange: BST
  • Founded: 1889
  • Industry: Multi-Utilities
  • Sector: Utilities
  • Market Cap: US$2.732b
  • Listing Market Cap: US$2.532b
  • Shares outstanding: 67.29m
  • Website: https://www.avistacorp.com

Number of Employees


Location

  • Avista Corporation
  • 1411 East Mission Avenue
  • Spokane
  • Washington
  • 99202-2600
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AVANYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
AV6DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
AV6BST (Boerse-Stuttgart)YesCommon StockDEEURJan 1968
AV6BRSE (Berne Stock Exchange)YesCommon StockCHCHFJan 1968

Biography

Avista Corporation operates as an electric and natural gas utility company. It operates through two segments, Avista Utilities and AEL&P. The Avista Utilities segment provides electric distribution and transmission, and natural gas distribution services in parts of eastern Washington and northern Idaho; and natural gas distribution services in parts of northeastern and southwestern Oregon, as well as generates electricity in Washington, Idaho, Oregon, and Montana. This segment also engages in the wholesale purchase and sale of electricity and natural gas. The AEL&P segment offers electric services to approximately 17,000 customers in the city and borough of Juneau, Alaska. The company generates electricity through hydro, thermal, and wind facilities. As of February 8, 2019, it provided electric service to approximately 393,000 customers and natural gas to approximately 361,000 customers. In addition, the company engages in venture fund investments, real estate investments, and other investments. Avista Corporation was founded in 1889 and is headquartered in Spokane, Washington. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/04 04:10
End of Day Share Price2020/04/03 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.